VK Play Product Director Alexander Mikheev on the prospects for the game development and distribution markets

The product director of VK Play told Kommersant about the prospects for the game development and distribution markets. Alexander Mikheev.

— How can you characterize the situation in the distribution and development markets for video games in Russia?

— Over the past 12 years, Russian development has been developing in the field of mobile games. It was profitable for companies to develop mobile games with distribution through global platforms or become contractors for large international studios. Since the spring of 2022, we have seen a process of market reboot. Established distribution and profit chains from platforms have ceased to exist. Now developers are focusing on alternative platforms and countries where content is hosted. The percentage of games being developed for the Russian market has increased significantly, especially in the field of independent development. A distinctive feature of our market has always been the strong position of the PC, so Russian developers are now busy preparing PC games.

— How will the distribution market change in the future, should we expect one large or several niche players?

— The market will continue to be restructured, developers will be forced to use different platforms with the main focus on one large one, such as VK Play. Now there are more than 10 thousand games on VK Play, we plan to fill the catalog with foreign titles (names.— “Kommersant”). The process of localizing foreign content is underway, and in 2024 we will have more new high-quality games. The prospect of opening new large stores in Russia is low, since this requires large investment and infrastructure investments. Potentially, we see mobile operators among the distributors of gaming content.

— How can Russian sites develop given that consumers are accustomed to American Steam?

— The first thing you need to do is a quality product for both the developer and the user. Every year 10 thousand new games appear on Steam. But only 17% of them earn more than $5 thousand over their entire lifetime. We are now focused on finding and posting quality content. We invest a lot of effort in reaching direct agreements with developers and work through game publishing partners. We are also developing the functionality of the VK Play platform: we will be able to do what Steam cannot – give access to the huge audience of the VK ecosystem.

— Last year, VK Play announced plans to distribute 300 million rubles. seed investments in video game development studios. What are the results?

— We received more than 400 applications with great potential; after selection, we left 20 first-priority projects with a total investment of 120 million rubles. The first deals are currently being closed.

— How long does it take for these studios to start releasing products that will be in demand?

— On average it is about 10–12 months.

— VK met with potential partners from China and Korea, how do they feel about the prospect of distributing games on the Russian market?

— In the Russian market there is a high demand for Asian titles, and publishers with extensive experience in operating and localizing such games. We negotiate with companies from Korea with the help of partners. Companies from China are still eyeing the Russian market. There is certainly interest, so right now we need to build up interaction processes.

Interviewed by Nikita Korolev